New Delhi: The Narendra Modi government’s much-touted skilling scheme, the Pradhan Mantri Kaushal Vikas Yojana (PMKVY), isn’t quite achieving the results the Centre had hoped for. According to a report in the Indian Express, data revealed that of the 30.67 lakh candidates who had been trained or were undergoing training across the country in June 2017, only 2.9 lakh had received placement offers. That’s less than a tenth.
In order to address this issue, the newspaper reported, the government is planning to move to a more district-centric approach, which it expects will provide better short-term results. According to what a senior government official told Indian Express, the Centre has realised that the PMKVY scheme is struggling because of the lack of quality training and an information asymmetry regarding the demand-supply dynamics of skilled candidates. By making things more decentralised and bringing on district collectors to ensure proper implementation, the government expects more efficient monitoring.
“PMKVY is not the answer to India’s problems. You can’t do too much about quality, location etc in the short term. We will be able to rejig much of it and make it more purposeful with a district-level action plan with good quality information. A district-level skill development action plan can be prepared in three months. It can be prepared for 100 districts in one go and the money can be handed over to the state governments and districts. Then, the government can get into MoUs and put into place monitoring mechanisms for this district-level action plan,” the official told Indian Express.
The Ministry of Skill Development and Entrepreneurship, the official added, is currently looking at district-level data to study the demand-supply conditions in each district, which had not been done under the PMKVY so far. “The government should be generating data to find out that where is the requirement for say, plumbers, and where are they coming from. Then we have to research and find where are they best trained, at the origin or the destination. There are some skills where destination-skilling is superior to origin-skilling, but it depends on what wage point are people willing to migrate. For example, a plumber from Odisha will not migrate for Rs 5,000 a month but will migrate for Rs 15,000 a month. The core of the government’s focus should be this kind of work and making this data available,” the official told the newspaper.
The National Skill Development Corporation (NSDC), responsible for the implementation of the PMKVY, won’t be involved in the district-level implementation. “NSDC can help with capacity creation and serious technical assistance. It can be part of preparation of district-level plans. NSDC’s responsibility is something else, not schemes,” the official said.
That the skill India programme isn’t really achieving it’s objectives has been said before, including by those who have been involved with the scheme in some capacity. Orlanda Ruthven, who works on employment and labour standards in India, argued in The Wire that the scheme may even be increasing the number of precarious jobs and keeping wages down:
In 2014, I was charged with finding jobs for Skill India-trained entrants from Eastern India in Delhi-NCR’s auto-components and electronics industries. The assignment allowed me a vantage point on the skills gap – that between the supply of provincial youth armed with skills certificates, and the demand for workforce from production plants serving Indian and global markets. What do such jobs look like for new entrants? And is the government skills policy helping to deliver jobs, and better jobs?
…The jobs offered in the large automotive and electronics plant of the capital region and elsewhere are overwhelmingly casual, short-term, insecure and poorly paid. We may hope that the flexibility claimed today by industry de facto may be somewhat curtailed when de jure reforms come to pass, but enforcement remains a huge question mark. The global and mechanized character of these industries reinforces the uncertainty and slow growth established by recent economic trends. There is scant sign that government skills policy has improved job quality, and, by subsidising the stream of new entrants at no cost to employers, it may have had the opposite effect and even kept wages down. At best, the skills policy in these sectors has helped to preserve existing jobs and – perhaps – to create more jobs at this low wage-high flexibility price point.
The oft-cited failure of industry to engage in the government’s skills policy is partly explained by the fact that in many industries, skill is simply not the binding constraint. There are industries where the skilled workforce is long established (the textile and garment industry, for example); there are industries where technology changes so rapidly that companies plan for in-house training (the electronics and capital goods industry, for example). And there are industries where automation levels have reached a point where the majority of roles are unskilled. As one auto components manager explained, there is little need for skilled and long-serving workers where production is modularized and problems can be easily diagnosed.
But that skill may not be a key constraint of industry has not prevented industry from taking advantage of the government’s skills policy, if in undeclared ways. My experience has shown that Skill India serves industry in two important ways: in helping to maintain a steady stream of flexible workers, and in providing a way to tie in these better educated workers for longer periods on trainee contracts through partnership with industry. It is to secure the availability of compliant and flexible workers at minimum cost, rather than to access a better skilled workforce, that industry has engaged with Skill India.